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Colombia rising?

The population of Bogotá, capital of Colombia, is
about to pass 8 million.

By Anthony
Boynton, Bogotá, Colombia

December
26, 2011 – Links International Journal of Socialist Renewal -- It may
not be the mother of all bubbles, but it is a whopper. Colombia’s economy is
rising as fast as a hot air balloon, but one that is almost certain to burst.
Mining, petroleum, industrial agriculture and construction are all growing at
record rates – fueled by a flood tide of investment, much of it foreign
investment – directed by the World Bank and its local allies within the
government of President Juan Manuel Santos, and made possible by the
dispossession of millions of Colombians from the countryside through decades of
violence combined with disastrous flooding caused by global warming.

Colombian
cities have being growing as fast as any in the world. There are now more than
25 cities with populations of more than 200,000, at least five cities with more
than 1 million people, three with more than 2 million; Bogotá the capital is
about to pass 8 million.

The
growth of these cities has been fuelled not only by a high birth rate, but by
the movement of millions of people from the countryside. Since 1985, more than
6 million people have been displaced by paramilitary violence and military
conflict. In the last year, 3 million more were displaced by flooding caused by
back to back La niñas, which have caused two record rainy seasons in one
year.

The
speculative fever in real estate has caused housing prices in the cities to
triple. Old neighbourhoods are being torn down in Bogotá to make room for
fields of six-story apartment buildings, while cow pastures ringing the city
are turning into massive industrial parks and shopping malls; 167 new malls are
being built on top of the more than 100 that have sprung up in the last decade.

The
wild investment binge is due to several factors.

Displacement

Most
important, but rarely discussed, is that a vast new and impoverished working
class has been created in the cities by the displacement of millions of people.
This has added to the state and paramilitary terror against trade unions to
depress wages, benefits and working conditions. Two-thirds of Colombia’s
workers work in what is euphemistically called the “informal sector” where they
receive even less than the state-mandated level of wages and benefits. The
legal minimum monthly salary is about 630,000 pesos (566,700 plus a 67,800
transportation subsidy), which is about 250 euros or US$327.

Second,
profitable investment opportunities have dried up in Europe and North America.
This means that Colombian capitalists no longer speculate in Miami real estate,
but look closer to home to invest their money. It also means that European,
Canada and US capital is also looking towards Third World countries like
Colombia for profitable opportunities.

Third,
worldwide demand for coal, oil and metals skyrocketed during the last decade.
Part of this was due to China’s “economic miracle”, but part was due to the
maintenance of artificially high energy prices by wars and the threats of wars
in the Middle East. A small part has also been due to private capital shifting
out of Venezuela and moving next door.

Fourth
is the perception that the Revolutionary Armed Forces of Colombia – People’s Army (FARC-EP) and the National Liberation Army (ELN) have been defeated and investors,
local and foreign, no longer have to fear payments of “extortion” or
“kidnapping” of their executives and workers.

Fifth,
successive governments of Colombia have privatised and deregulated the economy.
Import duties on mining equipment have disappeared, state-owned companies have
been sold to foreign investors or turned into public-private ventures traded on
stock exchanges, and “free trade agreements” have been signed with the USA, the
European Union and various individual countries.

Sixth,
the government of President Santos has restored good relations with Venezuela
and Ecuador, which had been frozen during the government of President Alvaro Uribe.
These has meant a return of good times to Colombian manufacturers, especially
those in the garment and food processing industries whose main export markets
have always been nearby countries.

Social
tensions

Beneath
the surface appearance of capitalist good times, Colombia is accumulating
enormous social tensions. The 2011 oil workers’ strike and most importantly the
victorious national public university strikes are likely to be the harbinger of
more conflict to come.

Health
care in the country, which is considered to be a right of all Colombians under
the country’s constitution, is in mortal crisis. Public hospitals have been
brought to verge of bankruptcy by the deliberate policy of the government of
starving them of cash to promote privately owned “health provision entities”.

The
rapid pace of urbanisation has led to crises of public transportation in every city,
but especially in the capital of Bogotá. where the city’s “Transmilenio” system
of mass transit has proven to be too little, too late for the city’s growth.
State contracting to private companies has also been rife with corruption,
delaying the construction of a subway system, expansion of the existing system
and expansion of major highways connecting the city to other parts of the
country.

The
vast new work force in mining, oil and manufacturing look with envy at the
relatively good wages and working conditions of the still unionised sectors of
the economy, most notably the workers at the state-owned oil company Ecopetrol.
The sharp conflict by workers together with communities in the oilfields
against Pacific Rubiales has been largely based on demands to bring their
levels up to those of the workers at Ecopetrol.

At
the same time, the environmental destruction being caused to the sensitive
ecologies of diverse parts of Colombia, ranging from the unique high Andean paramos
endangered by gold mining, to the coastal rainforests being logged by
paramilitaries and rainforests endangered by petroleum exploration have led to
the formation of new environmentalist protest movements. In at least one case,
that of Gold Star (a gold mining company), the protest movement has been
successful.

Where
things will go in 2012 is anybody’s guess. Much depends on the world economy,
but much depends on the new social movements that are beginning to be born here
in Colombia.